PricewaterhouseCoopers is bringing aboard more than 600 tax professionals from General Electric and acquiring GE’s tax technologies, the firm announced Thursday.
A GE facility in Fort Worth, Texas
Luke Sharrett/Bloomberg
The deal involves tax professionals from 42 different nations. PwC already possesses the biggest tax practice in the U.S. and internationally, with 41,000 tax professionals working in 157 countries.
The sophisticated tax strategies used by GE’s extensive tax unit has gained notoriety in recent years for lowering the corporate giant’s effective tax rate to nearly zero on billions of dollars in income. Over the past 10 years, according to the advocacy group Citizens for Tax Justice, GE paid an effective federal income tax rate of -1.6 percent on $58 billion in profits, while over the past 15 years, its federal income tax rate was only 5.2 percent.
The deal with PwC stemmed from GE’s re-evaluation of its current and future delivery of its global tax services. The new Global Enterprise Tax Solutions team will be part of PwC Tax and will provide managed services to not only GE, but other PwC clients. The five-year, renewable agreement takes effect April 1, 2017.
“The caliber of talent joining our firm from GE is remarkable,” said PwC vice chairman and managing partner Mark Mendola in a statement. “This arrangement will enable us to continue providing our clients with the very best tax services in an increasingly volatile and uncertain environment. Integrating GE’s talent with PwC’s broad capabilities will allow us to deliver upon the Tax Function of The Future in an increasingly digitally enabled tax world.”
The agreement will give GE continued access to its team of international tax experts along with the flexibility to adjust the requirements to its changing structure.
“We are pleased to advance our longtime relationship with PwC in a way that provides an opportunity for other leading companies to tap into the world’s best tax team while providing outstanding career opportunities for those legacy GE professionals,” GE vice president and senior tax counsel Mike Gosk said in a statement.
Michael Cohn, editor-in-chief of AccountingToday.com, has been covering business and technology for a variety of publications since 1985.